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Editor’s Note: Trains have always been one of the cheaper modes of transportation in China. However, due to changes in the market and the organization in charge of ticket pricing, fares will be increasing in April. Will it affect you? Read more to find out.

On February 13th, Caixin, citing information from industry insiders stated that starting on April 21st, 2017, ticket prices for second-class train seats will increase by 25-30 percent and first-class seats will increase by 65-70 percent.

Currently the head office of China Railway has not responded to questions regarding this matter.

According to a February 11th report by Fujian Daily, the Coastal Southeastern Railway Management Co. Ltd. (CSRM) is responsible for managment of the lines in question. Altogether, this includes the lines running between Shanghai, Hangzhou and Ningbo as well as Ningbo to Shenzhen.

A report, issued by the National Development and Reform Commission on December 23rd, 2015, gave railway transit enterprises the right to determine the prices of tickets for second and first-class seating on G and D trains that travel between 200 and 250 kilometers per hour.

On February 12th, multiple international media outlets quoted a statement from a China Railway representative saying that the decision took into consideration multiple elements including the cost of operations, market demands and the prices of various other methods of transportation. G and D trains running between 200 and 250 kilometers per hour will undergo ticket pricing adjustment beginning on April 21st. Ticket prices of trains travelling over 300 kilometers per hour between the aforementioned stations will not be affected at this time.

The National Railway Administration will determine reasonable ticket prices based on supply and demand. Essentially, this means the prices of the tickets in question will fluctuate, and prices will be higher when demand is higher, enabling the railway to provide better services and more competitive ticket prices for passengers.

The representative also pointed out that the area covered by the Coastal Southeastern Railway system is economically developed, demands of customers are growing and competition is heavy between various modes of transportation there. Once ticket prices have been optimized and readjusted, there will be a marked improvement in both travel time and ticket pricing. Furthermore, such changes will be beneficial to the overall management of the organization and they will help to continuously improve conditions of customer service facilities, creating a better travel experience for passengers.

In an interview with CNR during the height of Spring Festival migration, China Railway Administration’s Deputy Director of Operations, Huang Renxin, expressed that they would institute the changes in accordance with national regulation and that “they would be very cautious in adjusting prices and input was welcome from any and everyone.”

Due to huge deficits accumulated over many years, China Railway has called for ticket price increases in years past, however none was ever approved by the government. At the end of last year, Shanghai Securities News published a quote from Northeast Securities saying that 2017 passenger transportation would see an annual rise in price, G and D train transit speeds and prices would both increase. Regular passenger prices would be set according to overall costs.

How Will Prices Be Determined?

In their notice, the National Development and Reform Commission says that when railway transportation enterprises are setting prices of first and second class G and D train railway ticket pricing should be setting the undiscounted, listed prices.

As has been stated previously, prices will fluctuate according to market competition, differences in service facilities, changes in passenger volume and distribution, and customer demands as well as their acceptance of price changes, ensuring the realistic execution of ticket pricing.

Both listed fares and the price of purchase will be set in accordance with this pricing system and travellers will be informed via ticket sales websites and booths in a timely manner. Published fares will be be announced to the public before purchase, and price adjustments will be announced to the public thirty days before changes are implemented.

How Were Prices Previously Set?

According to a CCTV report, G and D train ticket prices were previously dictated by the National Development and Reform Commission and the prices was simply the number of kilometers travelled multiplied by a set price.

Why Give Did Pricing Responsibilities Change Hands?

As has already been said, transfer of ticket pricing rights to China Railway is by no means unexpected. Before this year, competition had already begun between railways, airlines, highways and waterways, however the latter three systems all set their own ticket prices. Only train fares, notably G train ticket prices, are set by the government. Railways had lost their competitive edge when compared with other means of travel, government management was stretched too thin and railway profits were down, discouraging private enterprises from investing in the railway system.

Although prices will be higher overall, the change may in fact be beneficial for the railway system and it’s travellers. For those of us expats who often take G and D trains when travelling, we’ll just have to wait till we have some time off and see.

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The CPC is learning fast. Capitalism and price gouging. Someone in government is going to become a trillionair fast. They should have been putting moderate price increases every few years from the start. Soon the capitalistic gov't will learn what happens when people start getting gouged. I do agree the prices for travel in China are good now. But consider this: The hi speed train will cost as much as it does to fly if the price of the train ticket goes up by 30%

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